U.S. Imposes Restrictions on Funnull, Philippine Tech Company Linked to Global Cryptocurrency Frauds
The U.S. Treasury Department has announced sanctions against Funull Technology Inc. and its administrator, Liu Luzhi, for their alleged involvement in facilitating a type of large-scale cryptocurrency investment fraud known as "pig butchering" scams.
Role of Funull Technology Inc.
Funull Technology Inc., a Chinese company, operated as a provider of technological infrastructure and support for fraudulent cryptocurrency investment schemes. According to the U.S. Treasury Department, the company ran platforms and communication tools used to lure, groom, and defraud victims.
Liu Luzhi's Involvement
Liu Luzhi, a Chinese national, was reportedly involved in the operation of Funnull Technology Inc. He played a significant role in orchestrating and managing these deceptive operations, leveraging his position to oversee scam logistics and execution. Among his tasks was assigning domain names to cyber criminal groups.
Malicious Activities
The malicious websites hosted by Funnull were intended for fraudulent cryptocurrency investment schemes. Some of the cyber criminal groups linked to the assigned domain names were involved in virtual currency investment fraud, phishing schemes, and illicit online gambling platforms. Funull purchased large quantities of IP addresses from major cloud service providers and sold them to these criminal groups.
Funull also used domain generation algorithms (DGAs) to create domain names for websites hosted on the IP addresses it purchased. This strategy allowed the company to rapidly shift to new domains and IP addresses once legitimate providers became aware of the fraudulent activity. Funull supplied web design templates to cyber criminals, enabling them to mimic trusted brands.
Impact and Consequences
These activities have reportedly caused more than $200 million in losses for U.S. victims. In response, the U.S. Treasury Department's Office of Foreign Assets Control (OFAC) has imposed sanctions on Funull Technology Inc. and Liu Luzhi. These sanctions typically include freezing assets within U.S. jurisdiction, prohibiting U.S. persons and entities from dealing with them, and aiming to disrupt their ability to carry out or benefit from further illicit activities.
This designation serves as a warning to international financial institutions to avoid facilitating their transactions, thereby curbing their operational reach globally. Liu Luzhi has been placed on OFAC's Specially Designated Nationals and Blocked Persons (SDN) list as part of the enforcement actions.
Implications
American victims lose billions of dollars each year to cyber scams, with 2024 marking a record high in illicit revenue from these schemes. The sanctions imposed on Funull Technology Inc. and Liu Luzhi are part of ongoing efforts to combat cybercrime and protect consumers from financial harm.
A Chinese company named Funull Technology Inc., known for providing technological infrastructure and support to fraudulent cryptocurrency investment schemes, had a significant role in creating platforms and communication tools to lure victims and carry out these scams, as announced by the U.S. Treasury Department. Liu Luzhi, a Chinese national, played a crucial part in managing these deceptive operations, also leveraging his position to assign domain names to cyber criminal groups and purchase large quantities of IP addresses used in these illegal activities, such as finance-related investment fraud, phishing schemes, and cybersecurity threats in the technology sector.
